WTF?! An Economic Tour of the Weird, by Peter Leeson

Peter Leeson of George Mason University has published a new book, WTF?! An Economic Tour of the Weird, which you can purchase on Amazon by clicking here.  A trailer for the book, starring the author himself, can be found below:

The book covers a wide range of historical practices which may seem odd but, once you apply the tools of economics, make much more sense than is commonly believed.  For example, did you know that the Church used to put insects and rodents on trial for destruction of property?  These vermin were even appointed top legal minds for their defense!  Or how about the practice of using ordeals to supernaturally determine an accused person's guilt or innocence?  How do these practices relate to the use of, for example, polygraph tests today?

Pete's reasoning is that superstitious beliefs (which he defines as any belief that is widely held as true but is scientifically false) can be used as a form of technology to improve social outcomes.  To evidence this, he documents extensively many historical cases and explains their rationale through the lens of economics.  What's more, the book is one of the easiest reads I have ever come across.  Rather than reading as, well, a standard non-fiction book, it is written as a script of a tour guide leading patrons through a museum of curiosa.

For those of you who are interested in podcasts, Pete discusses the book with Hanne Tidman on the a16z Podcast, which you can find here, and with Isaac Moorehouse on his podcast here.

Foreign Aid and Child Sex Slavery

Troy University FRESHMAN (and econ major!!!), Pradyot Sharma, points out that governments might respond to foreign aid in ways that actually diminish any benefit the aid agencies are providing.

A snippet:

There are thousands of people who visit the country each year to volunteer in one way or another. These NGOs and volunteers not only bring in their expertise to help combat social and developmental challenges but also contribute a lot towards the tourism sector which employs a huge bulk of the population and is the main source of foreign exchange for the government. The expats who live there to do this aid work also have a purchasing power most Cambodians do not enjoy. As such, they are one of the main contributors to the national tax coffers. The government officials themselves make a lot of money from these people since the corruption rate is high – which I witnessed when the immigration official asked me for a $50 “processing fee” before stamping my passport.

Read the whole article here.

Gender Wage Gap - Troy Econ Lunch

This week's Econ Lunch topic at Troy University is on the gender wage gap.  According to BLS statistics, the average woman is paid 77% what her male counterparts are paid.  Other reports show that there are more CEOs named John OR David than there are women CEOs, period.

There is no doubt a lot of confusion circling around this statistic. Like the unemployment rate, understanding how it's calculated can shed light on the underlying truth/falseness of the claim.

If you're in the Troy, AL area, come join Dr. Hebert as we discuss this important topic. Links to suggested readings can be found here.

The Cost of Exports

My latest at The Hill can be found here.  A snippet:

For example, let’s suppose that you grow corn and that your neighbor grows wheat.  In order for you to get some of your neighbor’s wheat, you will have to give them some of your corn.  In other words, your farm will have to export corn so that your farm can import wheat.  In this context, we readily understand that the corn given up isn’t a benefit from the exchange, but is instead the cost of the wheat.  The same is true when we talk about trade between countries. When we export goods or services to other countries, we receive imports in return. Exports are the cost and imports are the benefit.

If Mr. Trump and Secretary Clinton are going to continue parading such economic ignorance as knowledge, I encourage them to voluntarily overpay at the grocery store.  If what you give up to get something is truly a benefit, then doing so would surely be a path towards making their households even wealthier than they already are.